States Offshore Government Contracts

Eighteen offshore outsourcing firms have captured
about $75 million in state contracts – primarily in
information technology – in at least 30 states.
Further these groups are hiring former government officials
and making state electoral campaign contributions to grease
the skids in their favor, according to Corporate Research
Project of Good Jobs First’s report “Your Tax Dollars at
Work…Offshore.”

The research report – commissioned by the
Washington Alliance of Technology Workers (WashTech), a
local union of the Communications Workers of America that
supports workers in the information technology sector –
found states are often not aware that funds may be going
to contracting jobs overseas. For example,states may think they are dealing with a US firm
because it has a domestic mailing address, but sometimes
that address is just a marketing office for a company
that is based offshore; other firms are technically
headquartered in the US but do all or most of their work
in offshore facilities.

Thus, taxpayers and state policy makers are ill-equipped
to respond, the study found, since most states have little
or no power to regulate work performed offshore or the
offshore vendors they find themselves dealing with.
To combat this, the report suggests a number of reform
measures:

Each state should require all contract bidders to
certify where the work on the project will be
performed.

Each state should require all contract bidders to
disclose the name and headquarters location of their
parent company.

Each state should require existing contract
holders to provide the previous two pieces of
information.

Each state should create a comprehensive
centralized database of contract awards by all state
agencies.

“As state legislatures continue to take up this issue,
they need the hard facts of how offshore contractors are
positioning themselves to target the work of state
governments,” said Marcus Courtney, president of
WashTech.